Hey hey: what's up my friends so in today's video, it's all about the rsi indicator right i'll share with you three golden rules you can't ignore, especially if you trade, the stock markets number one, the 10 period, rsi below 30. What's the significance of this right, so let me explain so when a 10 period rsi is below 30 looks something like this. Let's say this is the 70 level. This is the 30 level of the rsi.

Our site goes up, comes down, goes up, comes down and it's below 30.. This is where you want to look for buying opportunities or in the stock market, especially when the stock is trending higher. So, let's say, stock goes up, pulls back, goes up, higher pulls back right at this point when, when the rsi is below 30 charges are the stock is making a pullback and when the stock is making a pullback in an uptrend? This is where you can look for buying opportunities to go long, so a couple of ways to do it. Some quantitative traders will literally just look for 10 period rsi below 30, and then they have a limit order to buy the stock.

Just like that right, very pure quantitative trading approach, but for you you might be a price action trader, so you don't want to trade like kind of like without confirmation. So what else you can do is to look for a bullish, reversal, candlestick pattern like a hammer right to kind of like confirm that there are buyers stepping in before you look to get long. So that's one way you can use the 10 period rsi below 30 to kind of help. You identify the area of value right in uh in the stock market.

Okay, so give you an example. So this is the stock over here of olin corporation here, the 10 period rsi is below 30.. You can see this pretty much uh the lows of this pullback over here. Likewise, over here, the 10 period rs size is below 30, pretty much caught near the low of the pullback before it rebound higher, and you can also not just trade individual stocks.

If you want to trade, let's say the stock market index like the s p 500. It works as well right, 10 period, rsi below 30 over here and here as well. So, of course, this is not the low of the pullback it continued down lower before it rebounded up higher again. So one thing to note is that this is this is not foolproof.

Right doesn't mean the stock. Is the rsi is below 30? It will continue to bounce up higher for sure no right. There are times where it could continue to head down lower and then it would be a loss right. So please, you know, manage your expectations.

This is not like the holy grail, the secret sauce, the 100 winning rate doesn't exist so number two. When the rsi is consistently above 70, that is a sign of strength. So many traders they make a mistake. Oh rainer, the rsi above 70.

It's time to sell right, it's overbought! It cannot go up any higher, no right, it's a sign of strength. So here's why right don't think that the stock will reverse just because rsi is above 70 because chances are, it will continue higher. So let me give you an example. So if you look at this one 40 net, you can see over here this over here.

This rsi is above 70 right. You see this dotted line over here. This is the 70 period rsi and it has been above it right consistently and if you look at the stock price it has when it has gone up 98 right during the uh, when the rsi is above 70 for a sustained period of time. So if you look over here same thing, right rsi is above 70., okay, and during that period it went up 50.

So if you look at your stock chart, rsi is consistently above 70.. The last thing you want to do is to short that stock. Bad idea, right, if you, if you don't know what to do at least stay out of the market or even better still, you know what to do. You can look for opportunities to to get along right on that.

No nice trending stock, but the last thing you want to do is to short that stock because that's usually a bad idea so remember, rsi above 70, consistently is usually a sign of strength and finally, last one rsi above 60. What does it mean right? It's useful if you want to capture a swing right in the stock market, so, for example, let's say this is against rsi. Let's say this is 30 and let's say this is 60.. So if the rsi value starts to cross above 60 over here and if you want to capture a swing, this is a signal for you to capture a swing so because the stock will look, something like this go up, come down, go up and then it goes Up so when you make this search up higher is when the rsi starts to cross above 60, and that's usually an exit signal that you can use to exit your trade.

So an example over here you can see over here right for this uh stock right, uh, crocs, rsi here gotten above 60. Right so, let's say, for example, you went along on this bullish reversal pattern at this swing low over here right, nice hammer. Looking right, then, over here the rsi crossed above 60, just nice, where you can see that the market actually made this one swing up higher that one swing. So this is where you can exit the trade right after the close of this green candle when the rsi is now above 60..

So this lets, you lets you capture that one swing right in your trade. So quick recap right number one! When the stock is in an uptrend, you can look for buying opportunities right when the rsi is above, or rather below 30., when the rsi is consistently above 70. That is a sign of strength. Please right don't mistake it as shorting opportunity, especially for the stock markets and finally, if you want to capture a swing, can look to sell when the rsi crosses back above 60.

and by the way, if you are a stock trader or want to learn more about Stock trading, you can join me from this upcoming webinar. Next one is in january. Don't worry if you're watching this video it's already march april whatsoever, because i will update this page to the next webinar date. I intend to hold this webinar.

You know once every month or so once or twice a month, so you can join right, even though you might be watching this video sometime later in the future. So during this webinar we will talk about how you can actually beat the stock market and generate an extra 10, 20 percent or even 40 a year without relying on chart patterns studying fundamental news or whatsoever uh i'll, even share with you, a very simple trading strategy That has generated 2 421 over the last 21 years. I'll share with you right how to grow your account to seven figures and beyond, even if you have a small starting capital. So all this and more right covered during this two-hour webinar, it's live so just put in your name over here at your email address right.

You can't even put your phone number so before the webinar starts right. I will drop you a notification, so you know the webinar is about to start and you don't miss it. So with that said, i wish you good luck. Good trading right i'll, put the link somewhere below this video to sign up for this free webinar, and i will talk to you soon.